"Burma needs foreign investment and it needs it now."
It's complicated. The foreign investment that Burma will receive most of is the kind it needs the least: resource investment. This type of investment tends to create little direct employment. Its major benefit is the income it generates for the government. But the government of Burma, like so many others, isn't good at turning resource revenues into productive investments.
Despite this, the prevailing attitude in the capital seems to be that "foreign investment equals development." That's just not true. Different types of foreign investment have drastically different effects on the economy. Investment that transfers technology and brings know-how can be beneficial, but resource investment can be dangerous because it creates revenue by selling non-renewable assets. Why sell these assets so quickly if the government does not yet have the capacity to invest all the proceeds in productive ways? Burma's recent steps toward acceptance of the Extractive Industries Transparency Initiative (EITI), which would help fight corruption by providing for open public accounting of resource revenues, could help but transparency and sovereign wealth funds are no substitute for a balanced economy. Burma would actually be better off without a massive rush of primary sector investment.
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